The stock market (as measured by the S&P 500 index) was flat during the month of June and remains only about 6% below the February 2020 all time high.
Given rising infection rates in the US and many other countries and significant damage to the global economy, how can the market be so strong?
Many investors are betting on a quick recovery. But even if the recovery is more difficult, long term investors will probably do well.
Extremely low interest rates are likely with us for a very long time. This makes bonds and GICs very unattractive while making stocks more valuable.
Don't get me wrong. My only forecast is that stock ownership will continue to be a roller coaster. It is the price we pay to have the opportunity to earn good long-term returns. If the path were certain, the rewards would be minimal. In other word, without risk there would be no return.
So, expect continued volatility, make sure your asset mix matches your risk appetite/tolerance (Chapter 9) and keep your costs low.
I know many thousands of readers have switched from high cost mutual funds to much lower cost DIY, AIY or robo investing. Good for you!
However, many would prefer ongoing personal advice at a reasonable cost. If this is your preference, just reply to this email and I may be able to offer some suggestions.
And, as always, I encourage your questions and comments.
Tune in for a guide to ETFs and investing strategies for potential long-term success. View in a browser Fidelity Fidelity Log in Creating a portfolio with ETFs: Why and how Creating a portfolio with ETFs: Why and how
Exclusive webinar: The market, my portfolio, and options. Exclusive webinar: The market, my portfolio, and options. View in a browser Fidelity Fidelity Log in The market, my portfolio, and options The market, my portfolio, and options